Cargo handling services under service tax
Defination and scope of Cargo Handling Services
“cargo handling service”
means loading, unloading, packing or unpacking of cargo and includes,—
(a) cargo handling services provided for freight in special containers or for non containerised freight, services provided by a container freight terminal or any other freight terminal, for all modes of transport, and cargo handling service incidental to freight; and
(b) service of packing together with transportation of cargo or goods, with or without one or more of other services like loading, unloading, unpacking, but does not include, handling of export cargo or passenger baggage or mere transportation of goods.
As per Section 65(105)(zzb) “Taxable Service” means any service provided or to be provided to any person, by a cargo handling agency in relation to cargo handling services.
Value of taxable services : The gross amount charged by the service provider for such services rendered by him.(section 67 of finance act,1994).
The service provider i.e. Cargo handling Agency is responsible for payment of service tax.
This service was introduced in service tax law on 16/08/2002 vide Notification No. 8/2002-ST, dated 01.08.2002
Some Important Clarifications on nature of services
The CBEC has clarified vide Circular No. 97/8/2007, dated 23-8-2007 that :
The nature of service provided by ‘ Express Cargo Service’ i.e. Transportation of good and articles from door to door with assurance of timely delivery falls within the scope and definition of courier agency and not cargo handling services.
Service Provider who undertakes delivery of documents, goods or articles received from a customer to another person for a consideration are covered within the definition of courier agency and not Cargo Handling Services.
CBEC Circular F. No. 334/1/2008-TRU dated 29/2/2008 clarifies that cargo handling Services does not cover mere transportation of goods. Mere transportation of good by road is covered under ‘ Goods transport Agency services’. Service provider who provides composite services like packing, loading, unloading with transportation of good are classified under Cargo Handling services or Goods Transport Agency Services depending their essential or predominant character of the service provided. Packing with packers and movers provide services of packing together with transportation will be classified under Cargo Handling Services.